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COE prices rebound in Categories A and B

COE prices rebound in Categories A and B
PHOTO: AsiaOne/Lynette Phua

In the second Certificate of Entitlement (COE) bidding exercise for June 2024, premiums bounced back in Categories A and B from the previous round, while Categories C and E saw prices dip instead.

Cat A COEs, which are used for cars with internal combustion engines (ICEs) of up to 1,600cc in capacity and have a power output of less than 130hp, as well as electric cars with a power output of up to 110kW, went up by $2,689 to end the bidding exercise at $90,889

Cat B COEs, which are used for ICE cars that exceed 1,600cc in capacity or have more than 130hp, and electric cars with over 110kW, saw a slightly lesser increase, and premiums went up by $1,727 to end at $102,334.

Cat C, which are for goods vehicles and buses, saw prices go down by $689 to end the bidding exercise at $69,900.

Cat D, which are reserved for motorcycles, went up by a mere $13 to close at $9,002.

Finally, Cat E, which is open to all vehicles except motorcycles, saw premiums go down by $1,600 to finish the exercise at $100,000.

The rebounds seen in Cat A and B could have been a reaction to the dip in prices from the last round of COE bidding. However, the drop in Cat E, which has been on a downward trend for the last three exercises, indicates that overall demand, and corresponding supply, in the market remains weak.

Vincent Ng, an automotive consultant who has almost three decades of experience in the industry, said, "Cat E is usually bid by motor traders who have stocks (of cars) on hand to offer for sales promotions. When the price (of Cat E COE) drops, it means that these dealers do not have cars available. So they will concentrate on bidding in Cat A and B."

He explained that dealers will also be more cautious about bidding for Cat E COEs during a period of low stock supply, as they only have a three-month validity period with which they can use to register cars. In contrast, Cat A and B COEs are valid for six months, which gives dealers more flexibility in holding them in hand while waiting for stocks to arrive.

Here's a summary of the second COE bidding exercise for June 2024:

Category Current COE Previous COE Difference PQP*
A $90,889 $88,200 +$2,689 $89,634 (Jun)
$91,401 (Jul)
B $102,334 $100,607 +$1,727 $101,800 (Jun)
$102,828 (Jul)
C $69,900 $70,589 -$689 $70,620 (Jun)
$69,749 (Jul)
D $9,002 $8,989 +$13 $9,649 (Jun)
$9,466 (Jul)
E $100,000 $101,600 -$1,600 Not applicable

*PQP, or Prevailing Quota Premium, is the moving average of COE prices in the last 3 months, and denotes the amount payable in order to renew a car's COE at the end of its tenure.

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